ObamaCare Endgame: Medicaid for All

By Richard Amerling, M.D.

Too many physicians endorse the “single payer” concept. Some are legitimately frustrated by the increasing difficulty in getting paid by private insurance companies and so called “health maintenance organizations.” My response is, “What if the single payer is Medicaid?” Unless ObamaCare is defeated in the Supreme Court, or defunded/repealed by Congress, we may soon be in a position to answer that question.

It has become clear that a major goal of ObamaCare is massive expansion of Medicaid. It mandates that states increase Medicaid eligibility, and provides temporary funding to this end. Medicaid rolls in many states have already swelled due to the prolonged recession and high unemployment. According to CNNMoney: “Strapped states are scrambling to address Medicaid’s ballooning costs before the federal government cuts back a critical source of funding this week. Medicaid is one of state’s costliest burdens. And the weak economy swelled the rolls to record numbers. Nearly 49 million people — or almost one in six Americans — were covered by the safety net at the end of 2009, the latest figures available.” From a Kaiser Foundation study: “…states reported an average increase in Medicaid spending of 8.8 percent across all states in fiscal year 2010, the highest rate of growth in eight years and well above their original projections…”

Furthermore, federal control of private health insurance and the bureaucratization of private medicine under ObamaCare will lead all private insurance down towards Medicare and Medicaid levels. Dictating who and what must be covered, at what price, and how much must be spent on care vs. administration/profit, will very likely lead to major cuts in provider reimbursement, and more intense micromanagement of care.

Medicaid is an excellent example of a failed government program. Even a cursory look at Medicaid should convince any rational person that government has no business being involved with health care. It was created in 1965-66 as an “add-on” to Medicare, the major entitlement passed as part of the Great Society under LBJ. While Medicare bribed physicians with “usual, customary, and reasonable” reimbursement (and a long-forgotten pledge not to interfere with care), Medicaid payments to physicians were, from the outset, pathetic. Thus, Medicaid was set up as a third tier system; one that would relegate its beneficiaries to hospital emergency rooms and clinics, rather than to private medical offices. Medicaid payments to physicians to this date in most states are well below the cost of care. The minimal participation of private physicians in the Medicaid program, which was by design, doomed the program to provide very expensive, fragmented, low quality care. How can a program that virtually excludes private physicians now be expanded and hope to succeed? Obviously, it cannot.

ObamaCare mandates an increase in Medicaid physician payments to Medicare levels in the hope of inducing more doctors to participate. This might have worked ten or fifteen years ago when Medicare payments were decent. Now, through price controls and cuts, they too, barely cover the cost of treatment. Also, the boost is temporary; payments revert to current levels after two years. Why would doctors take on Medicaid patients under this scenario? Many will not participate.

Where does Medicaid money go? The answer explains the Obama push to expand it. In New York State, where nearly one in four citizens is on Medicaid, the roughly $50 billion spent in FY 2009 was evenly divided between acute and chronic care. Acute care dollars went to managed care and health plans (34%), inpatient hospital payments (26%), outpatient services (12%), prescribed drugs (11%), and other services (11%). Only 1.7% went to physician, lab and X-ray services. Chronic care spending went to nursing facilities (36%), and home health and personal care, i.e., home attendants, (46%). Insurance and pharmaceutical companies, both major backers of ObamaCare, do well from Medicaid expansion. But the major beneficiaries are hospital and health workers, and their union, 1199/SEIU. Obama’s close association with SEIU and its boss, Andy Stern, is well documented, as is the massive campaign aid provided to him by this union.

Medicaid is a fiscal and humanitarian disaster, providing fragmented, lousy, and expensive care. It is a welfare system and enslaves participants in permanent poverty. Rather than expanding, it should be cut. The federal government should rescind all rules regarding Medicaid and return to the states their share of funds as block grants. States should be free to develop their own approaches to health care for the needy. One such approach, proposed by my colleague, Dr. Alieta Eck in New Jersey, offers free medical malpractice insurance to physicians who donate four hours per week to charity care. Let fifty solutions blossom in the fifty sovereign states!

---

Richard Amerling, MD is a nephrologist practicing in New York City. He is an Associate Professor of clinical medicine at Albert Einstein College of Medicine in New York, and the Director of Outpatient Dialysis at the Beth Israel Medical Center. Dr. Amerling studied medicine at the Catholic University of Louvain in Belgium, graduating cum laude in 1981. He completed a medical residency at the New York Hospital Queens and a nephrology fellowship at the Hospital of the University of Pennsylvania. He has written and lectured extensively on health care issues and is a Director of the Association of American Physicians and Surgeons. Dr. Amerling is the author of the Physicians’ Declaration of Independence
(http://www.aapsonline.org/medicare/doi.htm).